Zimbabwe is looking to restructure its debt, free up some money and rebuild its economy. President Emmerson Mnangagwa met with creditors and finance ministers to discuss the modalities.
With a national debt of 81% of GDP, the task is daunting for a country plagued by financial problems including hyperinflation and a failing exchange rate.
Mnangagwa announced that Zimbabwe is negotiating a Manpower Management Programme (SMP) with the International Monetary Fund (IMF) to pave the way for major policy reforms. African Development Bank (AfDB) President Akinwumi Adesina said the African Development Bank was willing to provide financial support for these reforms and help eliminate the debt.
Finance Minister Mthuli Ncube said the debt restructuring timetable would be clearer by mid-2025 after Zimbabwe secured bridge financing from creditors. Analysts have warned that resolving the crisis is critical to Zimbabwe’s economic recovery as it currently cannot access funds from the International Monetary Fund due to its debt.
Relieving debt from major lenders such as the African Development Bank, the World Bank and the European Investment Bank is key to unlocking the future. The IMF has been unable to provide financial support due to Zimbabwe’s debt default.
The SMP will restore good governance, although it does not include financial assistance from the International Monetary Fund. Zimbabwe’s debt problem remains complicated by the fact that much of its debt is debt and sanctions, and its access to international financial assistance is restricted.
